NOW Telecom Secures SEC’s nod for its equity restructuring; benefits from the Amended PSA

  • NOW Telecom secured the approval of SEC of its corporate restructuring including the increase of its authorized capital stock and the quasi-reorganization of its equity which allowed the Company to eliminate its deficit.
  • NOW Telecom shall greatly benefit from the amended PSA, which was signed by the President last 21st March 2022, allowing up to 100% foreign ownership of public services in the country.

26 April, 2022, Manila, Philippines — NOW Telecom Company, Inc. (“NOW Tel”) said it has secured the approval of the Securities and Exchange Commission (SEC) for the increase of NOW Tel’s authorized capital stock, quasi-reorganization of its equity and stock split.

As a result of the approved application,NOW Tel increased the number of its authorized common shares from 14.59 million to 952.09 million and lowered its par value from Php100.00 per share to Php1.00 per share. Previously, on 24 June 2021, the stockholders of NOW Corp approved the increase of the company’s stake in NOW Tel, for a total of Php600 million which were part of the proceeds from the placement received from the equity subscription of Velarde, Inc. to NOW Corp. The additional subscription from NOW Corp and other shareholders supported the increase in authorized capital stock of NOW Tel.

In addition, the SEC also certified the approval of the equity restructuring to fully wipe out NOW Tel’s deficit as of December 31, 2020. The quasi-reorganization has allowed NOW Tel to eliminate its deficit, which shall allow the company (NOW Tel) to declare dividends to its shareholders from its unrestricted retained earnings that may be generated subsequent to the quasi-reorganization.

“This strategic initiative of NOW Tel is envisioned to support its growth plans. The three-step equity restructuringbetter positions NOW Tel for investors both domestic and foreign to participate in its equity. With the amended Public Services Act allowing up to 100% foreign ownership in public utility companiesand this recent approval from SEC, NOW Tel can now proceed in its growth plans starting with its fundraising efforts including but not limited to tapping either the debt market or equity market, or both.” says Rene L. Rosales, NOW Telecom President and COO.

President Roa Rodrigo Duterte, on February 22, 2018, signed into law Republic Act. No. 10972 which extended NOW Tel’s franchise for another 25 years or until 2043.

In March 2022, NOW Tel scored another win as it received a favorable ruling from the Anti-Red Tape Authority (ARTA). ARTA reiterated its earlier resolution declaring the completeness of NOW Tel’s application and its order to assign the spectrum ranging from 1970Mhz-1980Mhz paired with 2160Mhz to 2170Mhz and 3.6Ghz and to 3.8Ghz, including 5G frequencies for mobile and fixed wireless.